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Should I Initial That Box?

January 26th, 2009 by Temple City Tribune

It seems that every day I pick up a newspaper, read a Blog, receive a bulletin from the California Association of Realtors® or an e-mail from an attorney with information as to what a real estate agent can or cannot do.  It used to be so easy to write a contract as everything was done on just one or two pieces of paper, but today a small tree must die every time a Listing or Purchase Agreement is written.
Today, I received a bulletin from an attorney advising, “One should almost always chose arbitration”.  The subject of “arbitration” appears on page 8 of the Purchase Agreement, and it is important to review this paragraph with the person that the real estate agent is representing, but the agent cannot advise either the buyer or seller to agree to this item.  I understand that there are cost savings and the process is much faster by agreeing to “arbitration”, but a real estate agent should not advise either the buyer or seller to initial this clause as doing so, the agent is giving legal advise.  It is ”Optional” and only the participants in the agreement must make that decision to either initial or not.  That is not the case if an attorney is writing the contract.
The Listing Agent requiring this portion of the Purchase Agreement to be initialed would write, when an offer is received without this clause being initialed, a Counter Offer stating that the seller is requesting that this clause be signed.  I can assure you that most sellers really don’t care; as they (the seller) only want the property to be sold … it is the seller’s agent making that request.  I have no intention of advising what a buyer should do, as by giving legal advise can be very costly to the real estate agent.
Mitigation Program: With the Federal Housing Finance Agency announcement of the new foreclosure mitigation program, I have received several calls from owners of vacation homes and investment properties asking if they would be eligible for this new program.  I contacted the Legal Department of the California Association of Realtors® for an answer, and this is what was sent to me:
“To be eligible, the borrower must: have missed three or more payments; own and occupy the property as a primary residence; have not filed for bankruptcy; and be able to have their mortgage modified so their entire mortgage payment, including association dues, if applicable, is no more than 38 percent of their gross income.”  So your second or vacation home would not be eligible for this program.

Homeowners Association Questions:
Q) Can a person, who is two months past due in paying their HOA dues, be eligible to vote on any program, change or agree to any assessment that the Board of Directors is presenting to the general membership?
A) Yes, No or Maybe.  It all depends on what is written in the Rules and Regulations, or if such a condition is included in any part of the CC & R’s.  I have seen one condo development Rules and Regulations where the owner had to be three months in the arrears in order not to be eligible to vote.
Q) Can a Board of Directors file a lien on a property if the owner is several months past due in making the monthly dues payment?
A) No, there are dollar limits required before being able to file a lien.  An owner must be $1,800 past due before such an action can be taken.  The Board of Directors should check this out with the Boards attorney or management company before an action is taken.  Do not rely on the HOA’s Board of Directors to make that decision.
Q) Our Board of Directors wants to change the Rules & Regulations so that dogs and cats are not to be allowed.  Can that be done without a vote from the general membership?
A) Again, you must read the CC&R’s and the Rules and Regulations.  From past experience, such a move by the Board of Directors, without a vote from the general membership with a majority agreeing to such a change, may not be able to properly do so.  There are problems, such as what happens to those owners that currently have such a pet?   Making this change, without a vote, can possibly lead to litigation taken by a pet owner.  Always check with the Boards attorney, before any major change to the Rules & Regulations are made.
Q) Rules at our development state that no owner can have a barbeque on their patio.  Yet, there are condo owners who have rented their units, doing nothing to correct the situation with their tenants.  What action can we take to avoid any possible fires?
A) Not allowing barbeques on an individual owners patio or balcony, if it is so stated in the Rules & Regulations, and if the owner or tenant proceeds to do so is a violation of those rules.  From those R & R’s that I have seen, the first step is to notify the property owner in writing, advising that their tenant is in violation of this safety rule.  Most likely, in the R & R’s, those that violate such a rule can be fined.  The Boards attorney, or management company, are the one’s that will write a letter to the condo owner.  All depends on what, if anything, is written in the R & R’s saying who is to contact the owner/tenant that is in violation.  Members of the Board of Directors, or any other concerned owner, should avoid making contact with the tenant, as that is why you have a management company and a Board attorney.

Louis Perlin CRS, GRI is a Syndicated Writer, Author, Professional Real Estate Witness and Mediator.  Lou can be reached by calling Marilyn Perlin Realtors, Inc. @ (760) 327-8401 or by e-mail: mprltr@aol.com

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